Ryanair has today announced it will cut it's Spanish traffic by 12%; biggest cuts will be in Madrid (35%) and Barcelona (23%). This will mean 4.5 million less pax which they claim will cause the loss of 4,500 jobs.

According to Ryanair, the Spanish government is doubling the airport taxes in MAD and BCN, and increasing them in the rest of the country.

Airport charges in Spain are renowned to have increased a lot in recent times; in fact, they doubled in the past 2.5 years. Combined with routes that may be underperforming and with low yields (revenue per passenger per mile)that may not be offset through higher load factors...

Most of those routes are already operated by other carriers, at least in BCN.

Summer Cancellations in Barcelona.

1. Alicante = VY
2. Hamburgo (Lubeck) = LH and GW direct to Hamburg (proper) as well as VY starting the route for the next summer season.
3. Munich = Direct to Munich (proper) with LH with many daily departures and also VY is starting the route.
4. Trieste[/quote] No other services except AZ but I dont think it´s such a lucrative or high yielding route.

I love how there is still this unfounded notion that a cut or the addition of one million pax will decrease or increase the amount of jobs by a thousand. This is just one model and it clearly does not always apply.
If it were the case, wouldn't you also have to deduct or add the same number of jobs at the destination airports...
Oh well. I guess FR scare tactics are still at work.

Quoting ushermittwoch (Reply 7):I love how there is still this unfounded notion that a cut or the addition of one million pax will decrease or increase the amount of jobs by a thousand.......Oh well. I guess FR scare tactics are still at work.

Quoting ba319-131 (Reply 9):I just don't see where all these claimed job losses will come from, they seem on the high side IMO.

Quoting vfw614 (Reply 10):If this calculation was true, Ryanair would be responsible for something like half a million jobs in Europe...

This is the standard FR line in public...that 1000 pax = 1 job in the region. They quote this ration in their press releases about new routes. this is the first time I have seen the same statistic used for closing routes.

So based on their 70M pax last year, FR indirectly employ 70,000 workers in the EU!!

Quoting downtown273 (Thread starter):Ryanair has today announced it will cut it's Spanish traffic by 12%; biggest cuts will be in Madrid (35%) and Barcelona (23%). This will mean 4.5 million less pax which they claim will cause the loss of 4,500 jobs.

Considering the economic situation in Spain, aren't cuts like that to be expected? 12% doesn't sound like much in a market where the unemployment rate is 25% and increasing.

This is actually very good news for Air Europe, Iberia and Vueling. Ryanair can say that jobs will be lost, but it isn't the only airline at Madrid and if there is the demand then others will take over these routes. They don't just create jobs - they've also put people out of work by helping to drive other airlines out of business, and they employ proportionally less staff than other locally-based airlines. So what if tax has increased in Spain? So have Ryanair's baggage fees and credit card charges! What adds more to the price of a ticket?

Quoting Viscount724 (Reply 16):Considering the economic situation in Spain, aren't cuts like that to be expected? 12% doesn't sound like much in a market where the unemployment rate is 25% and increasing.

Well, last year BCN's passengers grew by almost 18% with respect to 2010. So far 2012 is also a record year, with growth about 3% even after the demise of JK. On the other hand, MAD"s passengers in 2011 were within 1% or those in 2010, while so far it looks like it may lose some ~7% of passengers in 2012. So a mixed bag, but nothing really dramatic.

Quoting Viscount724 (Reply 16):Considering the economic situation in Spain, aren't cuts like that to be expected? 12% doesn't sound like much in a market where the unemployment rate is 25% and increasing.

You might think that but we have been in an economic crisis here in Ireland too and traffic levels are holding up very well.
This is despite FR cutting back on services with a goal to try and force overall passenger numbers using DUB to plummet, so then they can be seen to be the savior of the tourism industry.
This is all part of an ongoing PR campaign FR engage in with the media, government and Airport authority to try and get cheaper airport charges.
Well that last attempt backfired with other carriers filling the void left by FR.

Quoting peterinlisbon (Reply 17):This is actually very good news for Air Europe, Iberia and Vueling. Ryanair can say that jobs will be lost, but it isn't the only airline at Madrid and if there is the demand then others will take over these routes

I wonder what will happen to CRL/BRU-MAD as UX will start ops in this market as of Monday. It seems as if UX is still growing in Europe.

Quoting clydenairways (Reply 19):You might think that but we have been in an economic crisis here in Ireland too and traffic levels are holding up very well.

I don't think you can compare the situation in Ireland with the situation in Spain. The crisis in Spain is much worse and if you're working in the financial world you'll think that almost everyone is running out of Spain (which impacts business traffic). You only have to look at what happens in markets like MAD-AMS to see that the crisis has a very big impact (and there are more markets with similar problems).

Not a huge deal. VY will happily take over the BCN routes that are viable. If IB sorts out its labor issues, IB Express will happily take over the MAD ones. UX may pick up a few too. The FR reductions and U2 leaving MAD are great news for those three airlines. As long as the routes are viable, and many are IMO, there are plenty of takers for them.

In the case of Spain, the Euro crisis in Western Europe certainly does not help either. Routes and passengers to Eastern Europe, Latin America, Asia or the Middle East are growing instead. Ireland has the advantage that relies more on (esp.) US and ME traffic, so they are probably doing better on that side. Also, I am sure that many of those routes were "overserved" during the economic boom... AMS was served by IB, KL, U2, UX and until recently, KE (in addition to flights to EIN and RTM with FR and HV). And the growth of the likes of EK or QR will mean less passengers connecting with KL to Asia.

Btw many people is "running in" Spain now... good infrastructure, a reasonable institutional frame and lower labor costs than other parts of Europe (for instance, Ford Motor Co. just announced they are closing their Ghent plant ... but they are expanding their factory in Valencia). Not to talk about the coming cheap R.E... But that's another topic...

I wouldn't rely very much on UX. They have been doing weird decisions for a while. For instance, they just started MAD-BIO and MAD-VLC to connect traffic to their hub in MAD, subcontracted to a newly created regional company which is already known for their cancellations and delays (http://helitt.com/). And despite the bankruptcy of JK earlier this year and the cancellations of IB, U2 and FR, they have managed to take over very few routes.

Quoting SCQ83 (Reply 22):I wouldn't rely very much on UX. They have been doing weird decisions for a while. [...] And despite the bankruptcy of JK earlier this year and the cancellations of IB, U2 and FR, they have managed to take over very few routes.

Yes, I am confused about UX's strategy (or lack thereof). I would have expected them to benefit from JK's bankruptcy and U2's MAD closure, plus now FR cuts. But it seems only VY has reaped the benefits.